Anti-Environmental Riders on Kosovo Relief Bill

The House and Senate versions of the funding measure have each been approved and are expected go to conference on Tuesday together with the Kosovo Emergency Appropriations bill. In conference, a common version will be agreed that can be sent to the White House for the President's signature.

The Wilderness Society and the National Parks and Conservation Association said in a statement, "Providing essential financial assistance to victims of natural disaster and U.S. military personnel in Kosovo is crucial and deserves to be addressed quickly, fully, and without requiring offsets that could force unacceptable reductions in important programs. The environmental community urges Congress not to take actions that could result in gridlock and Presidential veto, which would ultimately be detrimental to refugees and soldiers abroad, citizens in Central America, and treasured public lands."

Two riders that would allow oil companies to delay paying royalties are already attached to the Senate version of the Hurricane Mitch Emergency Spending, while the House version is free of these riders.

One rider would delay implementation of an oil valuation rule by the Minerals Management Service (MMS) to make the largest oil companies pay all the royalties that could be assessed for the oil they extract from public lands until October 1999.

Lexi Shultz, staff attorney with U.S. Public Interest Research Group explains how it works. "The 40 biggest oil companies, about five percent of the 800 total oil producers, sell royalties to their own subsidiaries at false bargain basement prices, and pay royalties only on these false prices. The MMS is trying to rectify that accounting trick through the new oil valuation rule which says the biggest oil companies must use prices that reflect market values. By definition this new rule does not afftect small guys because they don't sell their own oil to themselves."

Part of the royalty revenue funds environmental programs like the Land and Water Conservation Fund and state public education programs. The MMS has estimated that delay of the rule cost taxpayers a staggering $66-$100 million a year.

For more than a year the oil industry has tried to delay this rule, and was successful in attaching delaying riders to two funding bills last year.

Now, for the first time New Mexico Senators Jeff Bingaman, a Democrat, and Pete Domenici, a Republican, have introduced a rider that would provide royalty relief of up to $123,000,000 for the owners of marginal wells that are barely productive, often owned by the same large oil companies. The rider allows owners of marginal wells to limit their royalties, sometimes to zero, Shultz said.

The Mining Law of 1872 allows mineral extraction without payment of royalties, allows mining companies to purchase public land at veyr low prices and does not require that companies clean up abandoned mines.

The BLM has already drafted new regulations that would make sure mining companies pay to clean up their abandoned mines. These regulations would be delayed by the Reid rider.

Shultz estimates there are over half a million abandoned and polluting mine sites across the country. Sixty-six are Superfund sites, and one mine in Colorado will cost $160 million to clean up according to the Environmental Protection Agency.

Senator Domenici has expressed his intention to attach another anti-environmental rider to the emergency supplemental funding package. According to public statements from his office, Domenici's rider would attempt to undermine the critical habitat provisions of the Endangered Species Act. In a sharp exchange with Interior Secretary Bruce Babbitt last week during a Senate hearing, Domenici signaled anger over a recent court ruling requiring critical habitat designation for the silvery minnow in the Rio Grande River. Environmentalists are concerned that he may attempt to protect New Mexico water users by blocking the critical habitat designation for the silvery minnow.

On March 4, at the 150th anniversary of the Department of the Interior, President Clinton, pledged to veto anti-environmental riders. "I implore the Congress: Let us not waste precious time battling over these bad anti-environmental riders, which I am going to veto anyway; instead, let's go on with the work of America," he said.

It is that pledge the environmental groups are depending on as Congress begins to cut a deal this week on the FY 1999 Emergency Supplemental Appropriations bill.